Prostacyclin analogues are standard therapeutic options for vasoconstrictive diseases, including pulmonary hypertension and Raynaud’s phenomenon. Although effective, these treatment strategies are expensive and have several side effects. To improve drug efficiency, we tested liposomal nanoparticles as carrier systems. In this study, we synthesized liposomal nanoparticles tailored for the prostacyclin analogue iloprost and evaluated their pharmacologic efficacy on mouse intrapulmonary arteries, using a wire myograph. The use of cationic lipids, stearylamine, or 1,2-di-(9Z-octadecenoyl)-3-trimethylammonium-propane (DOTAP) in liposomes promoted iloprost encapsulation to at least 50%. The addition of cholesterol modestly reduced iloprost encapsulation. The liposomal nanoparticle formulations were tested for toxicity and pharmacologic efficacy in vivo and ex vivo, respectively. The liposomes did not affect the viability of human pulmonary artery smooth muscle cells. Compared with an equivalent concentration of free iloprost, four out of the six polymer-coated liposomal formulations exhibited significantly enhanced vasodilation of mouse pulmonary arteries. Iloprost that was encapsulated in liposomes containing the polymer polyethylene glycol exhibited concentration-dependent relaxation of arteries. Strikingly, half the concentration of iloprost in liposomes elicited similar pharmacologic efficacy as nonencapsulated iloprost. Cationic liposomes can encapsulate iloprost with high efficacy and can serve as potential iloprost carriers to improve its therapeutic efficacy.